Acting Executive Director Bill Finch said the signs touting I Love NY, Taste NY and other tourism initiatives are in compliance with federal regulations, which lay out in great detail the types of logos, fonts and colors that can and cannot be placed on roadside signs.

Finch's comments came following a meeting of the Thruway's board of directors, which approved a $1.8 billion budget Monday that keeps tolls flat on the 570-mile superhighway system through 2017.

The signs follow the "spirit of the law," Finch said.

"I think that like anything, there is a letter of the law and there is a spirit of the law," he said. "And I think what we’re saying is we’re in compliance with the spirit of the law and working with the feds to try to get them to update some of their standards to be a little more modern."

The Federal Highway Administration has repeatedly notified the state that the signs violate federal and state law, the USA Today Network's Albany Bureau reported last week. The warnings date back to June 2013, when the federal administration denied a request by the state to begin posting the tourism signs.

The dispute could jeopardize federal highway funding, which the federal government can withhold if a state's highway program doesn't follow regulations governing traffic control devices.

The 514 signs, which are generally bunched in groups of five, were touted by Gov. Andrew Cuomo, who first unveiled the signage initiative in his 2014 State of the State address.

The signs are spread across the state, largely near major highway exits and near entry points near the state's border.

The signs were erected by the state Department of Transportation and the Thruway Authority. The DOT has also contended the signs are legal.

Meanwhile, the Thruway's board unanimously approved a 2017 budget Monday, which includes about $721 million for the ongoing construction of the $3.9 billion replacement for the Tappan Zee Bridge.

The budget anticipates a slight uptick in vehicles on the Thruway, from an estimated 264 million this year to 267.3 million next year. Tolls paid by passenger and commercial vehicles provide more than 95 percent of the authority's revenue.

The Thruway board also voted to increase a fee for toll scofflaws, as well as a change in policy for Thruway drivers with E-ZPass tags purchased out of state.

Under the change, out-of-staters with E-ZPass will soon be required to pay the full toll rate, rather than the 5 percent discount afforded to in-state E-ZPass users.

The change was criticized by AAA New York, which says the discount should be uniform for EZ Pass users regardless of where they purchased their tag.

"We think the whole point of E-ZPass is interoperability," said Alec Slatky, AAA's legislative analyst. "You can go from Virginia to Maine on one system. If you're trying to promote it as an interoperable mechanism, you should allow people to pay the same rate."